Smart Contract Templates: Legal semantics and code validation

Abstract

The Smart Contract Templates project supports legally enforceable smart contracts, using operational parameters to connect legal agreements to standardised code. The standardised code is derived from legal documentation and performs some or all of the provisions of that contract. For financial contracts such as derivatives agreements, the legal documentation may be extensive, and the standardised code to perform the contract may be substantial. An important issue is how to validate whether the smart contract code will correctly perform the provisions of the legal contract. This requires an understanding of the semantics of legal text and is an important step towards supporting industry adoption of legally enforceable high-value smart contracts.